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Multiple Production Department Factory Overhead Rates The total factory overhead for Bardot Marine Company is budgeted...

  1. Multiple Production Department Factory Overhead Rates

    The total factory overhead for Bardot Marine Company is budgeted for the year at $945,000, divided into two departments: Fabrication, $585,000, and Assembly, $360,000. Bardot Marine manufactures two types of boats: speedboats and bass boats. The speedboats require one direct labor hour in Fabrication and two direct labor hours in Assembly. The bass boats require four direct labor hours in Fabrication and four direct labor hours in Assembly. Each product is budgeted for 6,000 units of production for the year.

    When required, round all per unit answers to the nearest cent.

    a. Determine the total number of budgeted direct labor hours for the year in each department.

    Fabrication direct labor hours
    Assembly direct labor hours

    b. Determine the departmental factory overhead rates for both departments.

    Fabrication $ per dlh
    Assembly $ per dlh

    c. Determine the factory overhead allocated per unit for each product using the department factory overhead allocation rates.

    Speedboat: $ per unit
    Bass boat: $ per unit

Solutions

Expert Solution

a. Determine the total number of budgeted direct labor hours for the year in each department

Fabrication 30000 direct labor hours
Assembly 36000 direct labor hours

Fabrication :-

Speedboats = 1 hour * 6000 = 6000 hours

Bass boats = 4 hour * 6000 = 24000 hours

Total = 24000 + 6000 = 30000 hours

Assembly:-

Speedboats = 2 hour * 6000 = 12000 hours

Bass boats = 4 hour * 6000 = 24000 hours

Total = 24000 + 12000 = 36000 hours

b. Determine the departmental factory overhead rates for both departments.

Fabrication $19.5 per dlh
Assembly $10 per dlh

Fabrication :-

Overhead/Direct labor hours

= $585000/30000 DL hours = $19.5

Assembly :-

Overhead/Direct labor hours

$360000/36000 DL hours = $10

c. Determine the factory overhead allocated per unit for each product using the department factory overhead allocation rates.

Speedboat: $39.5 per unit
Bass boat: $118 per unit

Speedboat:-

Fabrication = $19.5 * 1 hour = $19.5

Assembly = $10 * 2 hours = $20

Total = $19.5 + $20 = $39.5

Bass boat:-

Fabrication = $19.5 * 4 hour = $78

Assembly = $10 * 4 hours = $40

Total = $78 + $40 = $118


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